ENERGY POLICY

Pipeline-debt limit pairing sets up fiscal chess game

Elana Schor, E&E reporter

E&E Daily: Thursday, September 19, 2013

House Republicans' plan to force approval of Keystone XL in their bill to raise the federal debt limit marks the first move in a chess game that could find leaders in both parties in lengthy negotiations over linking contentious energy issues to must-pass fiscal legislation.

Few details of the House GOP plan are set in stone, but a leadership aide confirmed yesterday that binding language on the $5.3 billion KXL pipeline will be part of a debt-ceiling bill that could come to the floor as soon as next week. Beyond the controversial Canada-to-U.S. oil sands crude link, Republicans are weighing whether to add other energy riders to a debt measure that many conservatives are loath to support without incentives (Greenwire, Sept. 18).

"If the idea is to grow the economy" in a bill that also pays the nation's debts on time, House Natural Resources Chairman Doc Hastings (R-Wash.) said yesterday, "then you have to have something that creates jobs."

Proposals to expand offshore drilling in the Atlantic, Pacific and Alaskan waterways have attracted bipartisan support in the past two sessions of Congress, he added, and "certainly something like that should be in the mix."

Rep. Ed Whitfield (R-Ky.), a top subpanel chairman on the House Energy and Commerce Committee, said yesterday that "there may be some riders on the debt ceiling," adding that "I know some of them are environmental."

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Whitfield and Energy and Commerce Chairman Fred Upton (R-Mich.) are readying a bill that would constrain U.S. EPA's ability to set carbon emissions standards for power plants, which could dampen their eagerness to add a rider on those regulations to the debt-limit package.

But which riders are in line for addition to the bill could spark intense behind-the-scenes jockeying in the Capitol in the coming days. The House's top appropriator for EPA and the Interior Department, Rep. Mike Simpson (R-Idaho), said yesterday that he expects "not a lot" but "a few" riders, and "I don't think much else" beyond KXL.

The Shaheen-Portman factor

The 1,179-mile link between Alberta's carbon-intensive oil sands and Gulf Coast refineries is also playing an increasingly central role in talks over an energy efficiency bill sponsored by Sens. Jeanne Shaheen (D-N.H.) and Rob Portman (R-Ohio) that has languished on the Senate floor this week.

A potential bipartisan, nonbinding resolution supporting presidential approval of KXL, similar to language that netted 62 votes in March, is facing a fierce push-back from environmental groups that see their position with moderate Democrats as stronger than it was six months ago.

"It must be Groundhog Day, because we've seen this song and dance countless times before -- whether it's about the Affordable Care Act, or tar sands -- the Republicans keep trying to gum up must-pass bills like the continuing resolution (CR) or the debt ceiling legislation by jamming their political sticks in the spokes of legislation," Melinda Pierce, the Sierra Club's deputy national campaigns director, said via email.

"The American people are over it."

If the efficiency bill falls by the wayside in the Senate -- particularly if it occurs today, on the fifth anniversary of KXL's application for a border-crossing permit from the White House -- pipeline supporters can be expected to turn their full attention to the debt limit fight.

If the nonbinding KXL language does make through the upper chamber, however, it could provide further enticement for House Republicans to call up their bipartisan counterpart to the underlying efficiency bill.

Rep. Peter Welch (D-Vt.), a House-side sponsor of the efficiency bill, said in an interview yesterday that symbolic KXL language could prove objectionable or acceptable to his caucus, depending on the circumstances.

"It could end up being the tail that wags the dog" and alienates Democratic backers, Welch said. But "if it's nonbinding, if it gives people the opportunity to express their preference while expressing support for energy conservation legislation, I don't know."

The CR scenario

The House is scheduled to vote tomorrow on its version of the CR, a stopgap spending bill intended to prevent a government shutdown on Sept. 30 while defunding the president's landmark health care reform law. Language defunding Obamacare was added to the continuing resolution following a revolt by House conservatives last week, but the Senate is virtually certain to reject the legislation.

The House yesterday canceled a recess previously set for next week in anticipation of twin showdowns with Senate Democrats over the CR and the debt-limit deadline, which could be reached as soon as Oct. 15. Meanwhile, Senate Democrats are maintaining a running tally of Republicans in the upper chamber who have criticized the House strategy.

Almost no one outside of the most ardent tea party supporters expects the gambit to defund Obamacare to succeed, but the debt limit offers another opportunity for House Speaker John Boehner (R-Ohio) and Senate Majority Leader Harry Reid (D-Nev.) to work out a deal, said one Republican lobbyist tracking the situation -- who cautioned that no one really knows how the drama will play out.

"If Reid is amicable on the debt limit bill, Boehner might be willing to willing to pass a CR with Dem support ... maybe," the source said, predicting a CR that includes some sort of Obamacare delay combined with spending limits slightly above sequester levels.

Reporters Nick Juliano and Manuel Quinones contributed.

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